Five Ways to Move your Startup Forward without Cash

Five Ways to Move your Startup Forward without Cash


OK, so no one has written you a check to fund your startup. What are you doing while you're waiting for that check?

If the answer is "nothing" and you think getting a check is the only way to start a business, I've got news for you. There are a lot of ways to move your startup forward without having cash in the bank.

Let's assume that it will probably take longer than you think it will to get funded, if you get a check at all. In the meantime, the more you can get done in the time you're waiting and pitching, the further along you'll be when you're ready to launch.

As a bonus, the further along you are before you get funded, the less equity you will potentially have to give up. Getting more done makes your company more valuable, which means you can command a higher premium for the equity you're about to give up!

There are countless ways to move the ball forward without cash. Here are just five:

Do all the setup stuff now. It costs next to nothing to incorporate, setup your bank accounts, draft your partnership agreements, find your hosting provider, shop for computers, locate office space, re-write your marketing plan, etc. The only reason you should avoid any of this now is if you are right in the middle of selling to your first paying customer!

Start recruiting. You don't need to wait until you have money to recruit talent. At the very least you can start having a coffee with these people and get the conversation going. Don't think of "interviewing" in the sense that you have to make a hiring decision today. You need people "on deck" so you can pull the trigger at a moment's notice.

Work on the product yourself. Even prototyping the product as best you can without cash is a big deal. It sets you further down the path of getting your product to market and gives you the opportunity to critically think about your actual product, not just your business. When the money does arrive to complete the product, you'll be further ahead of the game. Heck, you might even finish it.

Talk to prospective customers. Sure, you don't have a product now, but that's no reason to avoid talking to customers. Even if all you have are prototypes or a general concept for the product, the faster you can get some real customer feedback the better. More importantly, you're looking for your "venture customers" - the people that will invest in your idea by being the first customer to write a check. Not only will this help you raise capital, it'll put you light years ahead in your launch.

Work off of a "no cash" plan. When you write a business plan with the idea of getting funded in mind, you tend to think about your growth in terms of "if I get funded, I can start." Try writing a business plan that involves zero funding and begin putting your milestones in place for that company. This may stretch development timelines, force you to run lean, or only partially realize your true vision - but it's forward progress.

The last point about the "no cash" plan is particularly important. Funding is best used to help accelerate the growth of a business, not pay for its formation. Banking completely on funding to get going is a bad bet - focus on a plan that avoids funding until it's absolutely necessary.